I recently happened across a video clip of Milton Friedman schooling a young and idealistic Stanford University student on the topic of poverty. Although the student’s question was posed 35 years ago, if we change the shirt and the hairstyle (and possibly dumb down the vocabulary a bit), it’s not hard to envision it being posed today. Friedman made several quick and powerful points in his response, but the crux of his answer lies in this sentence:
There has never in history been a more effective machine for eliminating poverty than the free enterprise system and the free market.
Unfortunately, poverty warriors rarely, if ever, acknowledge this observation, nor do they advocate in favor of liberty as a means for fighting poverty. Instead, they advocate for more government in the form of more programs, more redistribution of wealth, and more regulation. They blame “unfettered capitalism” for the existence of income inequality and for the fact that there are poor in the nation and in the world, ignoring both the fact that “unfettered capitalism” hasn’t existed in a century and the obvious culprit i.e. the “helping hand” that they demand government provide.
A popular current meme related to the poverty issue is that of income inequality. We are inundated with scolds, class warriors and other statists telling us how the rich are getting richer while the poor are getting poorer, and as evidence of this assertion we are shown tables and graphs that indicate how income disparity between the wealthiest and the poorest is bigger than it used to be. Setting aside the fact that disparity does nothing to prove the assertion (the rich and the poor could both be getting richer or both be getting poorer under a scenario of widening disparity), why, after decades of a big-government War on Poverty that has failed to accomplish its goals, do so many people continue to insist that government intervention is the appropriate vehicle for addressing poverty?
That crowd includes dishonest people of several types, including those who seek personal benefit, political benefit, fame and notoriety as well as some who are driven by hate or envy. We know their motives are not genuine, so lets set them aside for a moment. The people who are the big mystery are those who genuinely believe, despite ample evidence to the contrary, that the poor are best helped by big government rather than by the free market.
The answer to the question and the mystery lies in the desire for control, or at least the illusion of control. Even with overwhelming evidence at hand, trusting outside forces to produce a desired result is something that makes many people uncomfortable. People favor action over inaction, even when inaction is better. It’s why many are more afraid of flying than driving, even though the latter is far, far more dangerous than the former. It’s why government continues to grow – people are far more attuned to those who say they’ll “do something” than to those who say “things will get better if we don’t meddle,” even when it’s demonstrable that the “do something” crowd has messed things up far, far more often than they’ve improved them. There’s even a fallacy named after this preference – the Politician’s Syllogism.
People look around them and see examples of poverty, of need, of want. They also look around and see examples of wealth, of profligacy, of luxury. It’s not surprising that the simultaneous existence of both elicits, at least in some, a feeling that they are witnessing unfairness and injustice, no matter that rational thought may contradict that sense. From there it’s an easy step to feel that “something should be done,” and what better vehicle for that passive-voice feeling than demanding government get involved?
This predilection makes the aforementioned dishonest people very happy, because they get to exploit those good intentions and feelings of caring to further their own agendas. The evidence of that exploitation is overwhelming. A half-century long War on Poverty hasn’t reduced the ranks of the poor (just one metric – food stamp enrollment – is at record highs and climbing). Politicians curry votes by promising to give the voters other people’s money in the form of countless assistance programs. Medicare/Aid fraud is estimated at $15-50 billion a year. Even private charities are not immune – stories about how some executive or trustee of a charity used the charity’s money for personal purposes are not rare. Most of us know or have heard of someone who has gamed the system for personal benefit. And, if we expand our view to the broader “social safety net,” we find even more examples. A recent news story pointed out that 96% of Long Island Railroad employees who apply for disability benefits are approved. 96%! This AFTER a scandal hit the papers and reforms were promised.
So, what to do? Throw the poor into the streets? Pull the rug out from under them? Cut off their assistance? Abandon them and force them to fend for themselves? Sounds terrible, but if we declare that we will take government out of the picture, get government out of the way, the poor will fare better. History makes that point. Besides, the poor won’t be abandoned. Government is not society and society is not government. Society, i.e. people i.e. you and I, is generous and charitable and cares for its fellows, for those in need. America is a profoundly charitable nation, and government is far too often an impediment to that charity. Just one example: A couple years ago, New York City enacted a ban on food donations to homeless shelters because it didn’t have a proper assessment of the salt, fat and fiber content of those donations.
A long-running argument against trusting the free market and private-sector charity to address poverty is that there’s a lack of certainty that it will be sufficient. The common straw-man is that, without government to ensure that everyone who needs gets, some will fail to get needed help. This, too, at its core, is about control.
Relinquishing control in favor of seemingly-unpredictable market forces can be scary, even though history makes the outcome of those market forces quite predictable. The evidence is overwhelming that liberty fosters wealth creation and lifts people out of poverty. Yet, no matter how inescapable the conclusion that the best thing we can do to help the poor is to get government out of their way, some will find it impossible to abide the lack of control. The solution for them is substitution. Substitute real control for the illusion of control. Exerting real control – “doing something” – with regard to poverty is as simple as doing something yourself. Volunteer at a shelter or soup kitchen. Donate to a charity you’ve vetted and trust. Give someone a job.
Delegating someone else to “do something” with other people’s money isn’t real control. You’ve no real say in what they do, how they do it, or with whose money they do it. And, you’ve no actual ability to challenge if results aren’t achieved. Once you’ve ceded power and control, you don’t get it back that easily. Those to whom you’ve ceded it will fight hard to keep it. And those who take benefit for themselves – benefit you wouldn’t give them if you were in charge – will be free to continue. That sense of control invoked by delegating the government to address poverty? It’s not real. It’s just an illusion, one that crooks and liars are all too happy to let you believe.
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